Accounting Policies of AIA Engineering Ltd. Company

Mar 31, 2015

1) Basis of Accounting:

These financial statements have been prepared in accordance with the
generally accepted accounting principles in India under the historical
cost convention on accrual basis. Theses financial statements have been
prepared to comply in all material aspects with the Accounting
Standards specified under Section 133 of the Companies Act, 2013, read
with rule 7 of the Companies (Accounts) Rules, 2014 and the relevant
Provisions of the Companies Act, 2013 ("the Act"). All assets and
liabilities have been classified as current or non-current as per the
company''s normal operating cycle and other criteria set out in the
Schedule III to the 2013 Act.

2) Use of Estimates:

The presentation of the Financial Statements in conformity with the
Generally Accepted Accounting policies require, the management to make
estimates and assumptions that affects the reported amount of Assets
and Liabilities on the date of the financial statements and the
reported amount of revenues and expenses during the reporting period
and disclosure of contingent liabilities. Such estimation and
assumptions are based on management''s evaluation of relevant facts and
circumstances as on date of Financial Statements. Difference between
the actual results and estimates are recognized in the period in which
the results are known / materialized.

3) Revenue Recognition:

Revenue is stated net of rebate and trade discount and excludes Central
Sales Tax and State Value Added Tax. With regard to sale of products,
income is reported when practically all risks and rights connected with
the ownership have been transferred to the buyers. This usually occurs
upon dispatch, after the price has been determined.

Export Benefits are accounted / recognized on accrual basis.

Dividend on Financial Instruments is recognized as and when realized.
Interest is recognized on accrual basis.

4) Fixed Assets:

Tangible Fixed Assets acquired by the Company are reported at
acquisition value, with deductions for accumulated depreciation and
impairment losses, if any. The acquisition value includes the purchase
price (excluding refundable taxes) and expenses directly attributable
to assets to bring it to the factory and in the working condition for
its intended use. Where the construction or development of any such
asset requiring a substantial period of time to set up for its intended
use, is funded by borrowings if any, the corresponding borrowing cost
are capitalized up to the date when the asset is ready for its intended
use.

Intangible Assets are reported at acquisition value with deductions for
accumulated amortization and any impairment losses.

Capital work in progress includes cost of assets at sites and
construction expenditure.

5) Depreciation:

Depreciation has been provided on Fixed Assets on Straight Line Method
as per useful lives specified in Schedule II of the Companies Act, 2013
as amended from time to time.

Amortization of intangible assets takes place on a Straight Line basis
over the assets anticipated useful life. The useful life is determined
based on the period of the underline contract and the period of time
over which the intangible assets is expected to be used.

Software is amortized over a period of 6 years. Patents are amortized
over a period of 20 years on straight line basis as the benefits are
generally available to the company for more than 10 years. Goodwill is
amortized over a period of 5 Years. No amortization is provided for in
case of Leasehold Land on Perpetual Lease.

6) Impairment of Assets:

The carrying value of assets of the Company''s cash generating units are
reviewed for impairment annually or more often if there is an
indication of decline in value. If any indication of such impairment
exists, the recoverable amounts of those assets are estimated and
impairment loss is recognized, if the carrying amount of those assets
exceeds their recoverable amount. The recoverable amount is the greater
of the net selling price and their value in use, Value in use is
arrived at by discounting the estimated future cash flows to their
present value based on appropriate discount factor. Net Selling price
is the estimated selling price in the ordinary course of business, less
estimated cost of completion and to make the sales.

7) Investments:

Investments are classified as Long Term and Current Investments. Long
Term Investments are valued at cost less provision for diminution other
than temporary, in value, if any. Current Investments are valued at
cost or fair value whichever is lower.

8) Inventories:

Inventories of Raw Materials and Stores are valued at cost or net
realizable value whichever is lower after considering the credit of VAT
and Cenvat. Stock in transit and Stock lying at third party premises
are valued at cost.

Inventories of Work in Process are valued at lower of cost or net
realizable value.

Inventories of Finished Goods are valued at cost or net realizable
value whichever is lower. Cost of Finished Goods and Work-in- Progress
are determined using the absorption costing principles. Costs include
the cost of materials consumed, labour and a systematic allocation of
variable and fixed production overheads, Excise duties at the
applicable rates are also included in the cost of Finished Goods.

Cost of raw materials, stores and spares are determined on weighted
average basis.

Excess / Shortages, if any, arising on physical verification are
absorbed in the respective consumption Accounts.

9) Employee Benefit:

(a) Short Term

Short Term employee benefits are recognized as an expense at the
undiscounted amount expected to be paid over the period of services
rendered by the employees to the company.

(b) Long Term

The Company has both defined contribution and defined benefit plans, of
which some have assets in approved funds. These plans are financed by
the Company in the case of defined contribution plans.

Defined Contribution Plans

These are plans in which the Company pays pre-defined amounts to
separate funds and does not have any legal or informal obligation to
pay additional sums. These comprise of contributions to Employees
Provident Fund. The Company''s payments to the defined contribution
plans are reported as expenses during the period in which the employee
performs the services that the payment covers.

Defined Benefit Plans

Expenses for defined benefit gratuity payment plans are calculated as
at the balance sheet date by independent actuaries in the manner that
distributes expenses over the employees working life. These commitments
are valued at the present value of the expected future payments, with
consideration for calculated future salary increases, using a
discounted rate corresponding to the interest rate estimated by the
actuary having regard to the interest rate on Government Bonds with a
remaining term i.e. almost equivalent to the average balance working
period of employees.

Other Employee Benefit

Compensated absences which accrue to employees which can be carried to
future periods but are expected to be encashed or availed in twelve
months immediately following the year end are reported as expenses
during the year in which the employees perform the services that the
benefit covers and the liabilities are reported at the undiscounted
amount of the benefits after deducting amounts already paid.

10) Central Excise Duty:

Excise duty is accounted on the basis of payments made in respect of
goods cleared.

11) Foreign Currency Transactions:

Transactions in foreign currencies are translated to the reporting
currency based on the exchange rate on the date of the transaction.
Exchange differences arising on settlement thereof during the year are
recognized as income or expenses in the Profit and Loss Account, except
it pertains to Fixed asset, where in such difference adjusted to
Carrying amount of Fixed Asset. In addition, exchange difference on
Long Term Liability, where they relate to acquisition of fixed assets,
in which case they are adjusted to carrying cost of such assets. In
case of items which are covered by forward exchange contracts, the
difference between the year-end rate and rate on the date of the
contract is recognized as exchange difference and the premium paid on
forward contracts is recognized over the life of the contract.

Cash and bank balances, receivables and liabilities (monetary items) in
foreign currencies as at the year end are translated at closing-date
rates, and unrealized translation differences are included in the
Profit and Loss Account.

Investments in foreign currency (non-monetary items) are reported using
the exchange rate at the date of the transaction.

Derivative instruments and hedge accounting

The Company strictly uses foreign currency forward contracts / Interest
Rate Swap to hedge its risks associated with foreign currency /
Interest Rate fluctuations relating to certain forecasted transactions.
Effective 30th September, 2013, the Company designates these as cash
flow hedges applying the recognition and measurement principles set out
in the Accounting Standard 30 "Financial Instruments: Recognition and
Measurements" (AS 30), to the extent it does not conflict with
Accounting Standards specified under section 133 of the Companies Act,
2013, read with rule 7 of the Companies (Accounts) Rules, 2014.

Foreign currency forward contract / Interest Rate Swap derivative
instruments are initially measured at fair value and are re- measured
at subsequent reporting dates. Changes in the fair value of these
derivatives that are designated and effective as hedges of future cash
flows are recognized directly in Hedging Reserve (under Reserves and
Surplus) and the ineffective portion is recognized immediately in the
Statement of Profit and Loss.

The accumulated gains / losses on the derivatives accounted in Hedging
Reserve are transferred to the Statement of Profit and Loss in the same
period in which gains / losses on the underlying item hedged are
recognized in the Statement of Profit and Loss.

Hedge accounting is discontinued when the hedging instrument expires or
is sold, terminated, or exercised, or no longer qualifies for hedge
accounting. When hedge accounting is discontinued for a cash flow
hedge, the net gain or loss will remain in Hedging Reserve and be
reclassified to the Statement of Profit and Loss in the same period or
periods during which the formerly hedged transaction is reported in the
Statement of Profit and Loss. If a hedged transaction is no longer
expected to occur, the net cumulative gains / losses recognized in
Hedging Reserve is transferred to the Statement of Profit and Loss.

12) Borrowing Cost:

Borrowing costs are recognized in the period to which they relate,
regardless of how the funds have been utilized, except where it relates
to the financing of construction or development of assets requiring a
substantial period of time to prepare for their intended use. Interest
on borrowings if any is capitalized up to the date when the asset is
ready for its intended use. The amount of interest capitalized for the
period is determined by applying the interest rate applicable to
appropriate borrowings.

13) Earning per Share:

Basic earning per share is calculated by dividing the net Profit After
Tax for the year attributable to Equity Shareholders of the Company by
the weighted average number of Equity Shares outstanding during the
year. Diluted earning per Share is calculated by dividing net profit
attributable to equity Shareholders (after adjustment for diluted
earnings) by average number of weighted equity shares outstanding
during the year.

14) Provisions, Contingent Liabilities and Contingent Assets :

A provision is recognized when the Company has a present legal or
constructive obligation as a result of past event and it is probable
that an outflow of resources will be required to settle the obligation,
in respect of which reliable estimate can be made. Provisions
(excluding long term benefits) are not discounted to its present value
and are determined based on best estimate required to settle the
obligation at the balance sheet date. These are reviewed at each
balance sheet date and adjusted to reflect the current best estimates.
Contingent liabilities are not recognized but are disclosed in the
notes to the Financial Statements. A contingent asset is neither
recognized nor disclosed.

15) Product Warranty Expenses :

Product warranty expenses are determined based on Company''s historical
experience and estimates are accrued in the year of Sale.

16) Taxation on Income :

(a) Provision for Current Tax is made as per the provisions of the
Income Tax Act, 1961.

(b) Deferred Tax resulting from "timing differences that are temporary
in nature" between accounting and taxable profit is accounted for,
using the tax rates and laws that have been enacted as on the Balance
Sheet date. The deferred tax asset is recognized and carried forward
only to the extent that there is a reasonable or virtual certainty, as
the case may be, that the asset will be realized in future.

17) Cash Flow Statement :

The Cash Flow Statement is prepared by the "Indirect Method" set out in
Accounting Standard 3 on "Cash Flow Statements" and presents the cash
flows by operating, investing and financing activities of the Company.

Cash and Cash equivalents presented in the Cash Flow Statement consist
of cash on hand, Balances with Schedule Bank and Short term highly
liquid financial instruments which are readily convertible into cash
and have original maturities of three months or less from date of
purchase.

Mar 31, 2014

1) Basis of Accounting :

The Financial Statements are prepared as per historical cost convention
and in accordance with the Generally Accepted Accounting Principles
(GAAP) in India, the provisions of the Companies Act 1956, read with
General Circular No:15/2013 dated 13th September, 2013, issued by the
Ministry of Corporate Affairs in respect of Section 133 of the
Companies Act, 2013 and the applicable Accounting Standards notified
under the Companies (Accounting Standards) Rules, 2006. All Income and
Expenditures having material bearing on the Financial Statements are
recognized on accrual basis.

2) Use of Estimates:

The presentation of the Financial Statements in conformity with the
Generally Accepted Accounting policies require, the management to make
estimates and assumptions that affects the reported amount of Assets
and Liabilities on the date of the Financial Statements and the
reported amount of revenues and expenses during the reporting period
and disclosure of contingent liabilities. Such estimation and
assumptions are based on management''s evaluation of relevant facts and
circumstances as on date of Financial Statements. Difference between
the actual results and estimates are recognized in the period in which
the results are known / materialized.

3) Revenue Recognition :

Revenue is stated net of rebate and trade discount and excludes Central
Sales Tax and State Value Added Tax. With regard to sale of products,
income is reported when practically all risks and rights connected with
the ownership have been transferred to the buyers. This usually occurs
upon dispatch, after the price has been determined.

Export Benefits are accounted / recognized on accrual basis.

Dividend on Financial Instruments is recognized as and when realized.
Interest is recognized on accrual basis.

4) Fixed Assets :

Tangible Fixed Assets acquired by the Company are reported at
acquisition value, with deductions for accumulated depreciation and
impairment losses, if any. The acquisition value includes the purchase
price (excluding refundable taxes), and expenses directly attributable
to assets to bring it to the factory and in the working condition for
its intended use. Where the construction or development of any such
asset requiring a substantial period of time to set up for its intended
use, is funded by borrowings if any, the corresponding borrowing cost
are capitalized up to the date when the asset is ready for its intended
use. The amount of benefits of Status Holder Incentive Scheme (SHIS)
utilized against Capital Expenditure are reduced from the cost of Fixed
Assets.

Intangible Assets are reported at acquisition value with deductions for
accumulated amortization and any impairment losses.

Capital work in progress includes cost of Assets at sites and
construction expenditure.

5) Depreciation :

Depreciation has been provided on Fixed Assets on Straight Line Method
as per the rates specified in Schedule XIV of the Companies Act, 1956
as amended from time to time.

Amortization of Intangible Assets takes place on a Straight Line basis
over the Assets anticipated useful life. The useful life is determined
based on the period of the underline contract and the period of time
over which the Intangible Assets is expected to be used.

Software is amortized over a period of 6 years. Patents are amortized
over a period of 20 years on Straight Line basis as the benefits are
generally available to the Company for more than 10 years. Goodwill is
amortized over a period of 5 Years. No amortization is provided for in
case of Leasehold Land on Perpetual Lease.

6) Impairment of Assets:

The carrying value of Assets of the Company''s cash generating units are
reviewed for impairment annually or more often if there is an
indication of decline in value. If any indication of such impairment
exists, the recoverable amounts of those Assets are estimated and
impairment loss is recognized, if the carrying amount of those Assets
exceeds their recoverable amount. The recoverable amount is the greater
of the net selling price and their value in use, Value in use is
arrived at by discounting the estimated future cash flows to their
present value based on appropriate discount factor. Net Selling price
is the estimated selling price in the ordinary course of business, less
estimated cost of completion and to make the sales.

7) Investments :

Investments are classified as Long Term & Current Investments. Long
Term Investments are valued at cost less provision for diminution other
than temporary, in value, if any. Current Investments are valued at
cost or fair value whichever is lower.

8) Inventories :

Inventories of Raw Materials and Stores are valued at cost or net
realizable value whichever is lower after considering the credit of VAT
and Cenvat. Stock in transit and Stock lying at third party premises
are valued at cost.

Inventories of Work in Progress are valued at lower of cost or net
realizable value.

Inventories of Finished Goods are valued at cost or net realizable
value whichever is lower. Cost of Finished Goods and Work-in- Progress
are determined using the absorption costing principles. Costs include
the cost of materials consumed, labour and a systematic allocation of
variable and fixed production overheads, Excise duties at the
applicable rates are also included in the cost of Finished Goods.

Cost of raw materials, stores and spares are determined on weighted
average basis.

Excess / Shortages, if any, arising on physical verification are
absorbed in the respective consumption Accounts.

9) Employee Benefits :

(a) Short Term

Short Term employee benefits are recognized as an expense at the
undiscounted amount expected to be paid over the period of services
rendered by the employees to the Company.

(b) Long Term

The Company has both defined contribution and defined benefit plans, of
which some have assets in approved funds. These plans are financed by
the Company in the case of defined contribution plans.

Defined Contribution Plans

These are plans in which the Company pays pre-defined amounts to
separate funds and does not have any legal or informal obligation to
pay additional sums. These comprise of contributions to Employees
Provident Fund. The Company''s payments to the defined contribution
plans are reported as expenses during the period in which the employee
performs the services that the payment covers.

Defined Benefit Plans

Expenses for defined benefit gratuity payment plans are calculated as
at the Balance Sheet date by independent actuaries in the manner that
distributes expenses over the employees working life. These commitments
are valued at the present value of the expected future payments, with
consideration for calculated future salary increases, using a
discounted rate corresponding to the interest rate estimated by the
actuary having regard to the interest rate on Government Bonds with a
remaining term i.e. almost equivalent to the average balance working
period of employees.

Other Employee Benefit

Compensated absences which accrue to employees which can be carried to
future periods but are expected to be encashed or availed in twelve
months immediately following the year end are reported as expenses
during the year in which the employees perform the services that the
benefit covers and the liabilities are reported at the undiscounted
amount of the benefits after deducting amounts already paid.

10) Central Excise Duty :

Excise duty is accounted on the basis of payments made in respect of
goods cleared.

11) a) Foreign Currency Transactions :

Transactions in foreign currencies are translated to the reporting
currency based on the exchange rate on the date of the transaction.
Exchange differences arising on settlement thereof during the year are
recognized as income or expenses in the Profit and Loss Account, except
it pertains to Fixed Asset, where in such difference adjusted to
Carrying amount of Fixed Asset. In addition, exchange difference on
Long Term Liability, where they relate to acquisition of Fixed Assets,
in which case they are adjusted to carrying cost of such assets. In
case of items which are covered by forward exchange contracts, the
difference between the year-end rate and rate on the date of the
contract is recognized as exchange difference and the premium paid on
forward contracts is recognized over the life of the contract.

Cash and bank balances, receivables and liabilities (monetary items) in
foreign currencies as at the year end are translated at closing-date
rates, and unrealized translation differences are included in the
Profit and Loss Account.

Investments in foreign currency (non-monetary items) are reported using
the exchange rate at the date of the transaction.

b) Derivative instruments and hedge accounting

The Company strictly uses foreign currency forward contracts / Interest
Rate Swap to hedge its risks associated with foreign currency /
Interest Rate fluctuations relating to certain forecasted
transactions/current transactions. Effective from 30th September, 2013,
the Company designates these as cash flow hedges applying the
recognition and measurement principles set out in the Accounting
Standard 30 "Financial Instruments: Recognition and Measurements"(AS
30), to the extend it does not conflict with accounting standards
notified under the Companies (Accounting Standard) Rules 2006.

Foreign currency forward contract / Interest Rate Swap derivative
instruments are initially measured at fair value and are re-measured at
subsequent reporting dates. Changes in the fair value of these
derivatives that are designated and effective as hedges of future cash
flows are recognized directly in Hedging Reserve (under Reserves and
Surplus) and the ineffective portion is recognized immediately in the
Statement of Profit and Loss.

The accumulated Gains / Losses on the derivatives accounted in Hedging
Reserve are transferred to the Statement of Profit and Loss in the same
period in which Gains / Losses on the underlying item hedged are
recognized in the Statement of Profit and Loss. Hedge accounting is
discontinued when the hedging instrument expires or is sold,
terminated, or exercised, or no longer qualifies for hedge accounting.
When hedge accounting is discontinued for a cash flow hedge, the net
gain or loss will remain in Hedging Reserve and be reclassified to the
Statement of Profit and Loss in the same period or periods during which
the formerly hedged transaction is reported in the Statement of Profit
and Loss. If a hedged transaction is no longer expected to occur, the
net cumulative Gains / Losses recognized in Hedging Reserve is
transferred to the Statement of Profit and Loss.

12) Borrowing Cost :

Borrowing costs are recognized in the period to which they relate,
regardless of how the funds have been utilized, except where it relates
to the financing of construction or development of assets requiring a
substantial period of time to prepare for their intended use. Interest
on borrowings if any is capitalized upto the date when the asset is
ready for its intended use. The amount of interest capitalized for the
period is determined by applying the interest rate applicable to
appropriate borrowings.

13) Earning per Share :

Basic earning per share is calculated by dividing the net Profit After
Tax for the year attributable to Equity Shareholders of the Company by
the weighted average number of Equity Shares outstanding during the
year. Diluted earning per Share is calculated by dividing net profit
attributable to equity Shareholders (after adjustment for diluted
earnings) by average number of weighted equity shares outstanding
during the year.

14) Provisions, Contingent Liabilities and Contingent Assets :

A provision is recognized when the Company has a present legal or
constructive obligation as a result of past event and it is probable
that an outflow of resources will be required to settle the obligation,
in respect of which reliable estimate can be made. Provisions
(excluding long term benefits) are not discounted to its present value
and are determined based on best estimate required to settle the
obligation at the balance sheet date. These are reviewed at each
balance sheet date and adjusted to reflect the current best estimates.
Contingent liabilities are not recognized but are disclosed in the
notes to the Financial Statements. A contingent asset is neither
recognized nor disclosed.

15) Product Warranty Expenses :

Product warranty expenses are determined based on Company''s historical
experience and estimates are accrued in the year of Sale.

16) Taxation on Income :

(a) Provision for Current Tax is made as per the provisions of the
Income Tax Act, 1961.

(b) Deferred Tax resulting from "timing differences that are temporary
in nature" between accounting and taxable profit is accounted for,
using the tax rates and laws that have been enacted as on the Balance
Sheet date. The deferred tax asset is recognized and carried forward
only to the extent that there is a reasonable or virtual certainty, as
the case may be, that the asset will be realized in future.

17) Cash Flow Statement :

The Cash Flow Statement is prepared by the "Indirect Method" set out in
Accounting Standard 3 on "Cash Flow Statements" and presents the cash
flows by operating, investing and financing activities of the Company.

Cash and Cash equivalents presented in the Cash Flow Statement consist
of cash on hand, Balances with Schedule Bank and Short term highly
liquid financial instruments which are readily convertible into cash
and have original maturities of three months or less from date of
purchase.

Mar 31, 2013

1) Basis of Accounting:

The Financial Statements are prepared as per historical cost convention
and in accordance with the Generally Accepted Accounting Principles
(GAAP) in India, the provisions of the Companies Act 1956, and the
applicable Accounting Standards notified under the Companies
(Accounting Standards) Rules, 2006. All Income and Expenditures having
material bearing on the Financial Statements are recognized on accrual
basis.

2) Use of Estimates:

The presentation of the Financial Statements in conformity with the
Generally Accepted Accounting policies requires, the management to make
estimates and assumptions that affect the reported amount of Assets and
Liabilities on the date of the financial statements and the reported
amount of revenues and expenses during the reporting period and
disclosure of contingent liabilities. Such estimation and assumptions
are based on management''s evaluation of relevant facts and
circumstances as on date of Financial Statements. Difference between
the actual results and estimates are recognized in the period in which
the results are known / materialized.

3) Revenue Recognisation:

Revenue is stated net of rebate and trade discount and excludes Central
Sales Tax and State Value Added Tax. With regard to sale of products,
income is reported when practically all risks and rights connected with
the ownership have been transferred to the buyers. This usually occurs
upon dispatch, after the price has been determined.

Export Benefits are accounted / recognized on accrual basis.

Dividend on Financial Instruments are recognized as and when realized.
Interest is recognized on accrual basis.

4) Fixed Assets:

Tangible Fixed Assets acquired by the Company are reported at
acquisition value, with deductions for accumulated depreciation and
impairment losses, if any. The acquisition value includes the purchase
price (excluding refundable taxes), and expenses directly attributable
to assets to bring it to the factory and in the working condition for
its intended use. Where the construction or development of any such
asset requiring a substantial period of time to set up for its intended
use, is funded by borrowings if any, the corresponding borrowing cost
are capitalized up to the date when the asset is ready for its intended
use.

Intangible Assets are reported at acquisition value with deductions for
accumulated amortization and any impairment losses. Capital work in
progress includes cost of assets at sites and construction expenditure.

5) Depreciation:

Depreciation has been provided on Fixed Assets on Straight Line Method
as per the rates specified in Schedule XIV of the Companies Act, 1956
as amended from time to time.

Amortization of intangible assets takes place on a Straight Line basis
over the assets anticipated useful life. The useful life is determined
based on the period of the underline contract and the period of time
over which the intangible assets is expected to be used.

Software is amortized over a period of 6 years. Patents are amortized
over a period of 20 years on straight line basis as the benefits are
generally available to the company for more than 10 years.

6) Impairment of Assets:

The carrying value of assets of the Company''s cash generating units are
reviewed for impairment annually or more often if there is an
indication of decline in value. If any indication of such impairment
exists, the recoverable amounts of those assets are estimated and
impairment loss is recognized, if the carrying amount of those assets
exceeds their recoverable amount. The recoverable amount is the greater
of the net selling price and their value in use. Value in use is
arrived at by discounting the estimated future cash flows to their
present value based on appropriate discount factor. Net Selling price
is the estimated selling price in the ordinary course of business, less
estimated cost of completion and to make the sales.

7) Investments:

Investments are classified as Long Term & Current Investments. Long
Term Investments are valued at cost less provision for diminution other
than temporary, in value, if any. Current Investments are valued at
cost or fair value whichever is lower.

8) Inventories:

Inventories of Raw Materials and Stores are valued at cost or net
realizable value whichever is lower after considering the credit of VAT
and Cenvat. Stock in transit and Stock lying at third party premises
are valued at cost.

Inventories of Work in Process are valued at lower of cost or net
realizable value.

Inventories of Finished Goods are valued at cost or net realizable
value whichever is lower. Cost of Finished Goods and Work-in- Progress
are determined using the absorption costing principles. Costs include
the cost of materials consumed, labour and a systematic allocation of
variable and fixed production overheads, Excise duties at the
applicable rates are also included in the cost of Finished Goods.

Cost of raw materials, stores and spares are determined on weighted
average basis.

Excess / Shortages , if any , arising on physical verification are
absorbed in the respective consumption Accounts.

9) Employee Benefit:

(a) Short Term

Short Term employee benefits are recognized as an expense at the
undiscounted amount expected to be paid over the period of services
rendered by the employees to the company.

(b) Long Term

The Company has both defined contribution and defined benefit plans, of
which some have assets in approved funds. These plans are financed by
the Company in the case of defined contribution plans.

Defined Contribution Plans

These are plans in which the Company pays pre-defined amounts to
separate funds and does not have any legal or informal obligation to
pay additional sums. These comprise of contributions to Employees
Provident Fund. The Company''s payments to the defined contribution
plans are reported as expenses during the period in which the employee
perform the services that the payment covers.

Defined Benefit Plans

Expenses for defined benefit gratuity payment plans are calculated as
at the balance sheet date by independent actuaries in the manner that
distributes expenses over the employees working life. These commitments
are valued at the present value of the expected future payments, with
consideration for calculated future salary increases, using a
discounted rate corresponding to the interest rate estimated by the
actuary having regard to the interest rate on Government Bonds with a
remaining term i.e. almost equivalent to the average balance working
period of employees.

Other Employee Benefit

Compensated absences which accrue to employees which can be carried to
future periods but are expected to be encashed or availed in twelve
months immediately following the year end are reported as expenses
during the year in which the employees perform the services that the
benefit covers and the liabilities are reported at the undiscounted
amount of the benefits after deducting amounts already paid.

10) Central Excise Duty:

Excise duty is accounted on the basis of payments made in respect of
goods cleared.

11) Foreign Currency Transactions:

Transactions in foreign currencies are translated to the reporting
currency based on the exchange rate on the date of the transaction.
Exchange differences arising on settlement thereof during the year are
recognized as income or expenses in the Profit and Loss Account.

Cash and bank balances, receivables and liabilities (monetary items) in
foreign currencies as at the year end are translated at closing-date
rates, and unrealized translation differences are included in the
Profit and Loss Account.

Investments in foreign currency (non-monetary items) are reported using
the exchange rate at the date of the transaction.

The Company enters into derivative contracts strictly for hedging
purposes and not for trading or speculation. Derivative transactions
are being considered as off balance sheet date transactions and
accordingly the gains/ losses arising there from are recognized under
respective heads of accounts as and when the settlement takes place
with the terms of the respective contracts.

12) Borrowing Cost:

Borrowing costs are recognized in the period to which they relate,
regardless of how the funds have been utilized, except where it relates
to the financing of construction or development of assets requiring a
substantial period of time to prepare for their intended use. Interest
on borrowings if any is capitalized up to the date when the asset is
ready for its intended use. The amount of interest capitalized for the
period is determined by applying the interest rate applicable to
appropriate borrowings.

13) Earning per Share:

Basic earning per share is calculated by dividing the net profit after
tax for the year attributable to Equity Shareholders of the Company by
the weighted average number of Equity Shares outstanding during the
year. Diluted earning per Share is calculated by dividing net profit
attributable to equity Shareholders (after adjustment for diluted
earnings) by average number of weighted equity shares outstanding
during the year.

14) Provisions, Contingent Liabilities and Contingent Assets:

A provision is recognized when the Company has a present legal or
constructive obligation as a result of past event and it is probable
that an outflow of resources will be required to settle the obligation,
in respect of which reliable estimate can be made. Provisions
(excluding long term benefits) are not discounted to its present value
and are determined based on best estimate required to settle the
obligation at the balance sheet date. These are reviewed at each
balance sheet date and adjusted to reflect the current best estimates.
Contingent liabilities are not recognized but are disclosed in the
notes to the Financial Statements. A contingent asset is neither
recognized nor disclosed.

15) Product Warranty Expenses:

Product warranty expenses are determined based on Company''s historical
experience and estimates are accrued in the year of Sale.

16) Taxation on Income:

(a) Provision for Current Tax is made as per the provisions of the
Income Tax Act, 1961.

(b) Deferred Tax resulting from "timing differences that are temporary
in nature" between accounting and taxable profit is accounted for,
using the tax rates and laws that have been enacted as on the Balance
Sheet date. The deferred tax asset is recognized and carried forward
only to the extent that there is a reasonable or virtual certainty, as
the case may be, that the asset will be realised in future.

17) Cash Flow Statement:

The Cash Flow Statement is prepared by the "indirect method" set out in
Accounting Standard 3 on "Cash Flow Statements" and presents the cash
flows by operating, investing and financing activities of the Company.

Cash and Cash equivalents presented in the Cash Flow Statement consist
of cash on hand and Short term highly liquid financial instruments
which are readily convertible into cash and have original maturities of
three months or less from date of purchase.

Mar 31, 2012

1) Basis of Accounting :

The Financial Statements are prepared as per historical cost convention
and in accordance with the Generally Accepted Accounting Principles
(GAAP) in India, the provisions of the Companies Act 1956, and the
applicable Accounting Standards notified under the Companies
(Accounting Standards) Rules, 2006. All Income and Expenditures having
material bearing on the Financial Statements are recognised on accrual
basis.

2) Use of Estimates:

The presentation of the Financial Statements in conformity with the
Generally Accepted Accounting policies requires, the management to make
estimates and assumptions that affect the reported amount of Assets and
Liabilities, Revenues and Expenses and disclosure of contingent
liabilities. Such estimation and assumptions are based on management's
evaluation of relevant facts and circumstances as on date of Financial
Statements. Difference between the actual results and estimates are
recognised in the period in which the results are known / materialised.

3) Revenue Recognisation :

Sales are stated net of rebate and trade discount and excludes Central
Sales Tax and State Value Added Tax. With regard to sale of products,
income is reported when practically all risks and rights connected with
the ownership have been transferred to the buyers. This usually occurs
upon dispatch, after the price has been determined.

Export Benefits are accounted / recognised on accrual basis.

Dividend on Financial Instruments are recognised as and when realised.
Interest on deposits is recognised on accrual basis.

4) Fixed Assets :

Tangible Fixed Assets acquired by the Company are reported at
acquisition value, with deductions for accumulated depreciation and
impairment losses, if any. The acquisition value includes the purchase
price (excluding refundable taxes), and expenses directly attributable
to assets to bring it to the factory and in the working condition for
its intended use. Where the construction or development of any such
asset requiring a substantial period of time to set up for its intended
use, is funded by borrowings if any, the corresponding borrowing cost
are capitalised up to the date when the asset is ready for its intended
use.

Intangible Assets are reported at acquisition value with deductions for
accumulated amortisation and any impairment losses.

Capital work in progress includes cost of assets at sites and
construction expenditure.

5) Depreciation :

Depreciation has been provided on Fixed Assets on Straight Line Method
as per the rates specified in Schedule XIV of the Companies Act, 1956
as amended from time to time.

Amortisation of intangible assets takes place on a Straight Line basis
over the assets anticipated useful life. The useful life is determined
based on the period of the underline contract and the period of time
over which the intangible assets is expected to be used.

Software is amortised over a period of 6 years. Patents are amortised
over a period of 20 years on straight line basis as the benefits are
generally available to the company for more than 10 years.

6) Impairment of Assets:

The carrying value of assets of the Company's cash generating units are
reviewed for impairment annually or more often if there is an
indication of decline in value. If any indication of such impairment
exists, the recoverable amounts of those assets are estimated and
impairment loss is recognised, if the carrying amount of those assets
exceeds their recoverable amount. The recoverable amount is the greater
of the net selling price and their value in use. Value in use is
arrived at by discounting the estimated future cash flows to their
present value based on appropriate discount factor. Net Selling price
is the estimated selling price in the ordinary course of business, less
estimated cost of completion and to make the sales.

7) Investments :

Investments are classified as Long Term & Current Investments. Long
Term Investments are valued at cost less provision for diminution other
than temporary, in value, if any. Current Investments are valued at
cost or fair value whichever is lower.

8) Inventories :

Inventories of Raw Materials and Stores are valued at cost or net
realisable value whichever is lower after considering the credit of VAT
and Cenvat. Stock in transit and Stock lying at third party premises
are valued at cost.

Inventories of Work in Process are valued at lower of cost or net
realisable value.

Inventories of Finished Goods are valued at cost or net realisable
value whichever is lower. Cost of Finished Goods and Work-in- Process
are determined using the absorption costing principles. Costs include
the cost of materials consumed, labour and a systematic allocation of
variable and fixed production overheads, Excise duties at the
applicable rates are also included in the cost of Finished Goods.

Cost of raw materials, stores and spares are determined on weighted
average basis.

9) Employee Benefit :

(a) Short Term

Short Term employee benefits are recognised as an expense at the
undiscounted amount expected to be paid over the period of services
rendered by the employees to the company.

(b) Long Term

The Company has both defined contribution and defined benefit plans, of
which some have assets in approved funds. These plans are financed by
the Company in the case of defined contribution plans.

(c) Defined Contribution Plans

These are plans in which the Company pays pre-defined amounts to
separate funds and does not have any legal or informal obligation to
pay additional sums. These comprise of contributions to Employees
Provident Fund. The Company's payments to the defined contribution
plans are reported as expenses during the period in which the employee
perform the services that the payment covers.

(d) Defined Benefit Plans

Expenses for defined benefit gratuity payment plans are calculated as
at the balance sheet date by independent actuaries in the manner that
distributes expenses over the employees working life. These commitments
are valued at the present value of the expected future payments, with
consideration for calculated future salary increases, using a
discounted rate corresponding to the interest rate estimated by the
actuary having regard to the interest rate on Government Bonds with a
remaining term i.e. almost equivalent to the average balance working
period of employees.

(e) Other Employee Benefit

Compensated absences which accrue to employees which can be carried to
future periods but are expected to be encashed or availed in twelve
months immediately following the year end are reported as expenses
during the year in which the employees perform the services that the
benefit covers and the liabilities are reported at the undiscounted
amount of the benefits after deducting amounts already paid.

10) Central Excise Duty :

Excise duty is accounted on the basis of payments made in respect of
goods cleared.

11) Foreign Currency Transactions :

Transactions in foreign currencies are translated to the reporting
currency based on the exchange rate on the date of the transaction.
Exchange differences arising on settlement thereof during the year are
recognised as income or expenses in the Profit and Loss Account.

Cash and bank balances, receivables and liabilities (monetary items) in
foreign currencies as at the year end are translated at closing-date
rates, and unrealised translation differences are included in the
Statement of Profit and Loss.

Investments in foreign currency (non-monetary items) are reported using
the exchange rate at the date of the transaction.

The Company enters into derivative contracts strictly for hedging
purposes and not for trading or speculation. Derivative transactions
are being considered as off balance sheet date transactions and
accordingly the gains/ losses arising there from are recognised under
respective heads of accounts as and when the settlement takes place
with the terms of the respective contracts.

12) Borrowing Cost :

Borrowing costs are recognised in the period to which they relate,
regardless of how the funds have been utilised, except where it relates
to the financing of construction or development of assets requiring a
substantial period of time to prepare for their intended future use.
Interest on borrowings if any is capitalised upto the date when the
asset is ready for its intended use. The amount of interest capitalised
for the period is determined by applying the interest rate applicable
to appropriate borrowings.

13) Earning per Share :

Basic earning per share is calculated by dividing the net profit after
tax for the year attributable to Equity Shareholders of the Company by
the weighted average number of Equity Shares outstanding during the
year. Diluted earning per Share is calculated by dividing net profit
attributable to equity Shareholders (after adjustment for diluted
earnings) by average number of weighted equity shares outstanding
during the year.

14) Provisions and Contingencies :

A provision is recognised when the Company has a present legal or
constructive obligation as a result of past event and it is probable
that an outflow of resources will be required to settle the obligation,
in respect of which reliable estimate can be made. Provisions
(excluding long term benefits) are not discounted to its present value
and are determined based on best estimate required to settle the
obligation at the balance sheet date. These are reviewed at each
balance sheet date and adjusted to reflect the current best estimates.
Contingent liabilities are not recognised but are disclosed in the
notes to the Financial Statements. A contingent asset is neither
recognised nor disclosed.

15) Product Warranty Expenses :

Product warranty expenses are determined based on Company's historical
experience and estimates are accrued in the year of Sale.

16) Taxation on Income :

(a) Provision for Current Tax is made as per the provisions of the
Income Tax Act, 1961.

(b) Deferred Tax resulting from "timing differences that are temporary
in nature" between accounting and taxable profit is accounted for,
using the tax rates and laws that have been enacted as on the Balance
Sheet date. The deferred tax asset is recognised and carried forward
only to the extent that there is a reasonable or virtual certainty, as
the case may be, that the asset will be realised in future.

17) Cash Flow Statement :

The Cash Flow Statement is prepared by the "indirect method" set out in
Accounting Standard 3 on "Cash Flow Statements" and presents the cash
flows by operating, investing and financing activities of the Company.

Cash and Cash equivalents presented in the Cash Flow Statement consist
of cash on hand and Short term highly liquid financial instruments
which are readily convertible into cash and have original maturities of
three months or less from date of purchase.

Mar 31, 2011

1) Basis of Accounting :

The Financial Statements are prepared as per historical cost convention
and in accordance with the Generally Accepted Accounting Principles
(GAAP) in India, the provisions of the Companies Act 1956, and the
applicable Accounting Standards notified under the Companies
(Accounting Standards) Rules, 2006. All Income and Expenditures having
material bearing on the Financial Statements are recognized on accrual
basis.

2) Use of Estimates :

The presentation of the Financial Statements in conformity with the
Generally Accepted Accounting policies requires, the management to make
estimates and assumptions that affect the reported amount of Assets and
Liabilities, Revenues and Expenses and disclosure of contingent
liabilities. Such estimation and assumptions are based on management's
evaluation of relevant facts and circumstances as on date of Financial
Statements. Difference between the actual results and estimates are
recognized in the period in which the results are known / materialized.

3) Revenue Recognisation :

Sales are stated net of rebate and trade discount and excludes Central
Sales Tax and State Value Added Tax. With regard to sale of products,
income is reported when practically all risks and rights connected with
the ownership have been transferred to the buyers. This usually occurs
upon dispatch, after the price has been determined.

Export Benefits (Pass Book Credit) are accounted / recognized as and
when utilized / sold by the Company.

Dividend on Financial Instruments are recognized as and when realized.
Interest on deposits is recognized on accrual basis.

4) Fixed Assets :

Tangible Fixed Assets acquired by the Company are reported at
acquisition value, with deductions for accumulated depreciation and
impairment losses, if any. The acquisition value includes the purchase
price (excluding refundable taxes), and expenses directly attributable
to assets to bring it to the factory and in the working condition for
its intended use. Where the construction or development of any such
asset requiring a substantial period of time to set up for its intended
use, is funded by borrowings if any, the corresponding borrowing cost
are capitalized up to the date when the asset is ready for its intended
use.

Intangible Assets are reported at acquisition value with deductions for
accumulated amortization and any impairment losses.

Capital work in progress includes cost of assets at sites and
construction expenditure.

5) Depreciation :

Depreciation has been provided on Fixed Assets on Straight Line Method
as per the rates specified in Schedule XIV of the Companies Act, 1956
as amended from time to time.

Amortization of intangible assets takes place on a Straight Line basis
over the assets anticipated useful life. The useful life is determined
based on the period of the underline contract and the period of time
over which the intangible assets is expected to be used.

6) Impairment of Assets :

The carrying value of assets of the Company's cash generating units are
reviewed for impairment annually or more often if there is an
indication of decline in value. If any indication of such impairment
exists, the recoverable amounts of those assets are estimated and
impairment loss is recognized, if the carrying amount of those assets
exceeds their recoverable amount. The recoverable amount is the greater
of the net selling price and their value in use. Value in use is
arrived at by discounting the estimated future cash flows to their
present value based on appropriate discount factor. Net Selling price
is the estimated selling price in the ordinary course of business, less
estimated cost of completion and to make the sales.

7) Investments :

Investments are classified as Long Term & Current Investments. Long
Term Investments are valued at cost less provision for diminution other
than temporary, in value, if any. Current Investments are valued at
cost or fair value whichever is lower.

8) Inventories :

Inventories of Raw Materials and Stores are valued at cost or net
realizable value whichever is lower after considering the credit of VAT
and Cenvat and stock in transit and stock lying at third party Premises
are valued at cost.

Inventories of Work in Process are valued at lower of cost or net
realizable value.

Inventories of Finished Goods are valued at cost or net realizable
value whichever is lower. Cost of Finished Goods and Work-in- Progress
are determined using the absorption costing principles. Costs include
the cost of materials consumed, labour and a systematic allocation of
variable and fixed production overheads, Excise duties at the
applicable rates are also included in the cost of Finished Goods.

9) Employee Benefit :

(a) Short Term

Short Term employee benefits are recognized as an expense at the
undiscounted amount expected to be paid over the period of services
rendered by the employees to the company.

(b) Long Term

The Company has both defined contribution and defined benefit plans, of
which some have assets in approved funds. These plans are financed by
the Company in the case of defined contribution plans.

(c) Defined Contribution Plans

These are plans in which the Company pays pre-defined amounts to
separate funds and does not have any legal or informal obligation to
pay additional sums. These comprise of contributions to Employees
Provident Fund. The Company's payments to the defined contribution
plans are reported as expenses during the period in which the employee
perform the services that the payment covers.

(d) Defined Benefit Plans

Expenses for defined benefit gratuity payment plans are calculated as
at the balance sheet date by independent actuaries in the manner that
distributes expenses over the employees working life. These commitments
are valued at the present value of the expected future payments, with
consideration for calculated future salary increases, using a
discounted rate corresponding to the interest rate estimated by the
actuary having regard to the interest rate on Government Bonds with a
remaining term i.e. almost equivalent to the average balance working
period of employees.

(e) Other Employee Benefit

Compensated absences which accrue to employees which can be carried to
future periods but are expected to be encashed or availed in twelve
months immediately following the year end are reported as expenses
during the year in which the employees perform the services that the
benefit covers and the liabilities are reported at the undiscounted
amount of the benefits after deducting amounts already paid.

10) Central Excise Duty :

Excise duty is accounted on the basis of payments made in respect of
goods cleared.

11) Foreign Currency Transactions :

Transactions in foreign currencies are translated to the reporting
currency based on the exchange rate on the date of the transaction.
Exchange differences arising on settlement thereof during the year are
recognized as income or expenses in the Profit and Loss Account.

Cash and bank balances, receivables and liabilities (monetary items) in
foreign currencies as at the year end are translated at closing-date
rates, and unrealized translation differences are included in the
Profit and Loss Account.

Investments in foreign currency (non-monetary items) are reported using
the exchange rate at the date of the transaction.

The Company enters into derivative contracts strictly for hedging
purposes and not for trading or speculation. Derivative transactions
are being considered as off balance sheet date transactions and
accordingly the gains/ losses arising there from are recognized under
respective heads of accounts as and when the settlement takes place
with the terms of the respective contracts.

12) Borrowing Cost :

Borrowing costs are recognized in the period to which they relate,
regardless of how the funds have been utilized, except where it relates
to the financing of construction or development of assets requiring a
substantial period of time to prepare for their intended future use.
Interest on borrowings if any is capitalized upto the date when the
asset is ready for its intended use. The amount of interest capitalized
for the period is determined by applying the interest rate applicable
to appropriate borrowings.

13) Earning per Share :

Basic earning per share is calculated by dividing the net profit after
tax for the year attributable to Equity Shareholders of the Company by
the weighted average number of Equity Shares outstanding during the
year. Diluted earning per Share is calculated by dividing net profit
attributable to equity Shareholders (after adjustment for diluted
earnings) by average number of weighted equity shares outstanding
during the year.

14) Provisions and Contingencies :

A provision is recognized when the Company has a present legal or
constructive obligation as a result of past event and it is probable
that an outflow of resources will be required to settle the obligation,
in respect of which reliable estimate can be made. Provisions
(excluding long term benefits) are not discounted to its present value
and are determined based on best estimate required to settle the
obligation at the balance sheet date. These are reviewed at each
balance sheet date and adjusted to reflect the current best estimates.
Contingent liabilities are not recognized but are disclosed in the
notes to the Financial Statements. A contingent asset is neither
recognized nor disclosed.

15) Product Warranty Expenses :

Product warranty expenses are determined based on Company's historical
experience and estimates are accrued in the year of Sale.

16) Taxation on Income :

(a) Provision for Current Tax is made as per the provisions of the
Income Tax Act, 1961.

(b) Deferred Tax resulting from "timing differences that are temporary
in nature" between accounting and taxable profit is accounted for,
using the tax rates and laws that have been enacted as on the Balance
Sheet date. The deferred tax asset is recognized and carried forward
only to the extent that there is a reasonable or virtual certainty, as
the case may be, that the asset will be realised in future.

17) Cash Flow Statement :

The Cash Flow Statement is prepared by the "indirect method" set out in
Accounting Standard 3 on "Cash Flow Statements" and presents the cash
flows by operating, investing and financing activities of the Company.

Cash and Cash equivalents presented in the Cash Flow Statement consist
of cash on hand and demand deposits with banks.

Mar 31, 2010

1) Basis of Accounting :

The Financial Statements are prepared as per historical cost convention
and in accordance with the Generally Accepted Accounting Principles
(GAAP) in India, the provisions of the Companies Act 1956, and the
applicable Accounting Standards notified under the Companies
(Accounting Standards) Rules, 2006. All Income and Expenditures having
material bearing on the Financial Statements are recognized on accrual
basis.

2) Use of Estimates:

The presentation of the Financial Statements in conformity with the
Generally Accepted Accounting policies requires, the management to make
estimates and assumptions that affect the reported amount of Assets and
Liabilities, Revenues and Expenses and disclosure of contingent
liabilities. Such estimation and assumptions are based on managements
evaluation of relevant facts and circumstances as on date of Financial
Statements. Difference between the actual results and estimates are
recognized in the period in which the results are known / materialized.

3) Revenue Recognisation :

Sales are stated net of rebate and trade discount and excludes Central
Sales Tax and State Value Added Tax. With regard to sale of products,
income is reported when practically all risks and rights connected with
the ownership have been transferred to the buyers. This usually occurs
upon dispatch, after the price has been determined.

Export Benefits (Pass Book Credit) are accounted / recognized as and
when utilized by the Company.

Dividend on Financial Instruments are recognized as and when realized.
Interest on deposits is recognized on accrual basis.

4) Fixed Assets :

Tangible Fixed Assets acquired by the Company are reported at
acquisition value, with deductions for accumulated depreciation and
impairment losses, if any. The acquisition value includes the purchase
price (excluding refundable taxes) and expenses directly attributable
to assets to bring it to the factory and in the working condition for
its intended use. Where the construction or development of any such
asset requiring a substantial period of time to set up for its intended
use, is funded by borrowings if any, the corresponding borrowing cost
are capitalized up to the date when the asset is ready for its intended
use.

Intangible Assets are reported at acquisition value with deductions for
accumulated amortization and any impairment losses.

Capital work in progress includes cost of assets at sites, construction
expenditure and advances made for acquisition of capital assets.

5) Depreciation :

Depreciation has been provided on Fixed Assets on Straight Line Method
as per the rates specified in Schedule XIV of the Companies Act, 1956
as amended from time to time.

Amortization of intangible assets takes place on a Straight Line basis
over the assets anticipated useful life. The useful life is determined
based on the period of the underline contract and the period of time
over which the intangible assets is expected to be used.

Goodwill is amortized over a period of 5 years.

6) Impairment of Assets: *

The carrying value of assets of the Companys cash generating units are
reviewed for impairment annually or more often if there is an
indication of decline in value. If any indication of such impairment
exists, the recoverable amounts of those assets are estimated and
impairment loss is recognized, if the carrying amount of those assets
exceeds their recoverable amount. The recoverable amount is the greater
of the net selling price and their value in use. Value in use is
arrived at by discounting the estimated future cash flows to their
present value based on appropriate discount factor. Net Selling price
is the estimated selling price in the ordinary course of business, less
estimated cost of completion and to make the sales.

7) Investments :

Investments are classified as Long Term & Current Investments. Long
Term Investments are valued at cost less provision for diminution other
than temporary, in value, if any. Current Investments are valued at
cost or fair value whichever is lower.

8) Inventories :

Inventories of Raw Materials and Stores are valued at cost or net
realizable value whichever is lower after considering the credit of VAT
and Cenvat and stock in transit and stock lying at third party premises
are valued at cost.

Inventories of Work in Process are valued at lower of cost or net
realizable value.

Inventories of Finished Goods are valued at cost or net realizable
value whichever is lower. Cost of Finished Goods and Work-in-Progress
are determined using the absorption costing principles. Costs include
the cost of materials consumed, labour and a systematic allocation of
variable and fixed production overheads, Excise duties at the
applicable rates are also included in the cost of Finished Goods.

9) Employee Benefit :

Mi Short Tor11

Short Term employee benefits are recognized as an expense at the
undiscounted amount expected to be paid over the period of services
rendered by the employees to the Company.

The Company has both defined contribution and defined benefit plans, of
which some have assets in approved funds. These plans are financed by
the Company in the case of defined contribution plans.

These are plans in which the Company pays pre-defined amounts to
separate funds and does not have any legal or informal obligation to
pay additional sums. These comprise of contributions to Employees
Provident Fund. The Companys payments to the defined contribution
plans are reported as expenses during the period in which the employee
perform the services that the payment covers.

(d) Defined Ienetit lh.ns

Expenses for defined benefit gratuity payment plans are calculated as
at the balance sheet date by independent actuaries in the manner that
distributes expenses over the employees working life. These commitments
are valued at the present value of the expected future payments, with
consideration for calculated future salary increases, using a
discounted rate corresponding to the interest rate estimated by the
actuary having regard to the interest rate on Government Bonds with a
remaining term i.e. almost equivalent to the average balance working
period of employees.

(e) Other hmpiovee Benefit

Compensated absences which accrue to employees and which can be carried
to future periods but are expected to be encashed or availed in twelve
months immediately following the year end are reported as expenses
during the year in which the employees perform the services that the
benefit covers and the liabilities are reported at the undiscounted
amount of the bensfits after deducting amounts already paid.

Excise duty is accounted on the basis of both, payments made in respect
of goods cleared as also provision made for goods lying in bonded
warehouses.

Ms i -:iic sun v i;r r. m i ta/i-,1. non- Transactions in foreign
currencies are translated to the reporting currency based on the
exchange rate on the date of the transaction. Exchange differences
arising on settlement thereof during the year are recognized as income
or expenses in the Profit and Loss Account.

Cash and bank balances, receivables and liabilities (monetary items) in
foreign currencies as at the year end are translated at closing-date
rates and unrealized translation differences are included in the Profit
and Loss Account.

Investments in foreign currency (non-monetary items) are reported using
the exchange rate at the date of the transaction.

The Company enters into derivative contracts strictly for hedging
purposes and not for trading or speculation. Derivative transactions
are being considered as off balance sheet date transactions and
accordingly the gains/ losses arising there from are recognized under
respective heads of accounts as and when the settlement takes place
with the terms of the respective contracts.

12) Borrowing Cost:

Borrowing costs are recognized in the period to which they relate,
regardless of how the funds have been utilized, except where it relates
to the financing of construction or development of assets requiring a
substantial period of time to prepare for their intended future use.
Interest on borrowings if any is capitalized upto the date when the
asset is ready for its intended use. The amount of interest capitalized
for the period is determined by applying the interest rate applicable
to appropriate borrowings.

13) Earning per Share :

Basic earning per share is calculated by dividing the net profit after
tax for the year attributable to Equity Shareholders of the Company by
the weighted average number of Equity Shares outstanding during the
year. Diluted earning per Share is calculated by dividing net profit
attributable to equity Shareholders (after adjustment for diluted
earnings) by average number of weighted equity shares outstanding
during the year.

14) Provisions and Contingencies :

A provision is recognized when the Company has a present legal or
constructive obligation as a result of past event and it is probable
that an outflow of resources will be required to settle the obligation,
in respect of which reliable estimate can be made. Provisions
(excluding long term benefits) are not discounted to its present value
and are determined based on best estimate required to settle the
obligation at the balance sheet date. These are reviewed at each
balance sheet date and adjusted to reflect the current best estimates.
Contingent liabilities are not recognized but are disclosed in the
notes to the Financial Statements. A contingent asset is neither
recognized nor disclosed.

15) Product Warranty Expenses :

Product warranty expenses are determined based on Companys historical
experience and estimates are accrued in the year of Sale.

16) Taxation on Income :

(a) Provision for Current Tax is made as per the provisions of the
Income Tax Act, 1961.

(b) Deferred Tax resulting from "timing differences that are temporary
in nature" between accounting and taxable profit is accounted for,
using the tax rates and laws that have been enacted as on the Balance
Sheet date. The deferred tax asset is recognized and carried forward
only to the extent that there is a reasonable or virtual certainty, as
the case may be, that the asset will be realised in future.

17) Cash Flow Statement:

The Cash Flow Statement is prepared by the "indirect method" set out in
Accounting Standard 3 on "Cash Flow Statements" and presents the cash
flows by operating, investing and financing activities of the Company.